Performance based pay up 21 percent

This gives the lower round picks more of a drive to perform well, and in my opinion would show them more respect than the higher round picks not earning their salary. Shouldn't there be a refund system of players that don't live up to their salary as far as production? I KNOW DREAMING

NEW YORK (March 27, 2007) -- Total compensation in the fifth year of the NFL's "Performance Based Pay" system increased by 21 percent, from $79.4 million to $96 million, the NFL announced.

The Performance Based Pay system was created as part of the 2002 Collective Bargaining Agreement extension. This system creates a fund used as a supplemental form of player compensation based on a comparison of playing time to salary. The system will remain in place in the new Collective Bargaining Agreement, with fixed increases to the system fund each year.

This year, the fund totaled $96 million ($3 million per club), and will grow by five percent each year of the Collective Bargaining Agreement. The fund will be $3.15 million per team in 2007 and $3.307 million per team in 2008.

The top recipient of Performance Based Pay for the 2006 season is Baltimore Ravens rookie safety Dawan Landry, who earned $366,017 in additional pay, which exceeded his 2006 base salary.

Clubs have been notified to distribute payments to players.

Players become eligible to receive Performance Based Pay in any season during which they play at least one down of the regular season.

Under the system, Performance Based Pay is computed by using a "Player Index." To produce the index, a player's regular season playtime (total plays on offense, defense and special teams) is divided by his adjusted regular season compensation (full season salary, prorated portion of signing bonus, earned incentives). Each player's index is then compared to those of the other players on his team to determine the amount of his pay.

"The Performance Based Pay system is especially beneficial to lower-salaried players," says NFL Executive Vice President of Labor Relations Harold Henderson. "Under this system, if a player is making the minimum but plays in a high percentage of his team's plays, he stands to get a larger payout than a teammate with equal playtime but a higher salary."

One hypothetical example is "Player A" in 2006 earning a salary of $600,000, playing in 50 percent of his team's plays. His bonus would total approximately $60,000. "Player B" has a salary of $6 million and took part in a similar percentage of plays. His bonus would be approximately $6,000.

Added NFLPA Executive Director Gene Upshaw, "'Pay for Performance' rewards players who may be on the bottom of the team pay scale, but play a majority of the games."

PERFORMANCE BASED PAY SYSTEM
Each player on the same team competes for his own share of his club's Performance Based Pay pool. The table below illustrates how the Index works, using a simplified four-player team as an example. Each player receives his share of the pool depending on how his index compares to those of his teammates.

Playtime Compensation Index Bonus Payout
Player A 50% $ 500,000 10.0 50% of the Club's pool (10 out of 20)
Player B 50% $ 1,000,000 5.0 25% of the Club's pool (5 out of 20)
Player C 20% $ 500,000 4.0 20% of the Club's pool (4 out of 20)
Player D 10% $ 1,000,000 1.0 5% of the Club's pool (1 out of 20)
Team Total: 20.0 Points

The following are the top 25 recipients of Performance Based Pay for the 2006 season